They like each other
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Initially, Penelope has no interest in Junior, and even makes fun of his name. Furthermore, when he attempts to engage her, she pretends he doesn't exist. That Halloween, they dress in similar costumes, so Junior takes the opportunity to talk to her, but all in all, she's still not interested.
It isn't until Junior hears her throwing up in the girl's bathroom that they begon to build a relationship. At first, Junior is a supportive listener. She addresses her bullimia, Junior supplies much needed support, and even some advice. After this, they become very close friends. Junior, of course, is in love. He asks Penelope to the dance, she finds out he has no money, and Penelope embraces his problem, in the same way he embraced hers.
Things aren't always easy though, the two encounter racism and disappointment throughout. Penelope because she's white; Junior.... because he's not.
The Absolutely True Diary of a Part-Time Indian